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Is Kenney Hrabik 'Hit Piece' On Target?

A mailer paints the City Council candidate in an unfavorable light and he cries foul.

A mailer sent to Rancho Santa Margarita residents paints local businessman Kenney Hrabik in a negative light in his bid for a seat on the City Council. In red block letters, the mailer says: "Rancho Santa Margarita residents deserve honest leaders. Do not vote for Kenney Hrabik."

As Hrabik tries to connect the dots on the mailer's source—he suspects opponents Carol Gamble and Tony Beall are in cahoots with the political action committee that allegedly sent it, Concerned Californians for Effective Government—a larger question looms:

Is the mailer accurate?

Hrabik's response through an attorney was to send a cease and desist letter to the PAC, saying the piece "contains several false and misleading statements about Hrabik and may subject the Committee and others to substantial liability and defamation."

The letter also asks that Concerned Californians for Effective Government "attempt to rectify the harm done by such mailers by issuing a written, public apology to Hrabik acknowledging that the mailer misstated the facts regarding Hrabik's claim and settlement."

The specific statements Hrabik cites as false are:

  • "Hrabik filed frivolous litigation claim against our city" ... and "threaten(ed) to sue our City for approximately $380,000."
  • "Hrabik took $50,000 of our tax dollars to drop his claim" and "took $50,000 of our tax dollars for himself."

"It's very disappointing that my opponents would stoop to this level," said Hrabik,  calling the mailer "a hit piece."

Here's a look at the mailer's main claims (in bold):

Hrabik filed frivolous litigation claim against our city.

As far as Patch knows, no formal court filing against the city was ever made. Rather, Hrabik signed a formal settlement agreement with the city in which he received $50,000 and agreed not to sue. He calls it a fee waiver or simple refund. Historically, the city only enters into such settlements when threatened with a lawsuit.

Here's the back story: In an effort to recoup some of his losses from the Conditional Use Permit (CUP) process for his Dove Canyon Courtyard business, Hrabik presented a "processing fee waiver request," in which he asked the city to reimburse $50,000 of the $60,000 CUP fees he had paid "in protest." In doing so, he indicated he also had paid $85,000 for legal counsel and suffered $235,000 in lost revenue over 28 months. Grand total: $380,000. After being advised by then-city manager Steve Hayman the city would never refund the full $60,000 in CUP fees—Hrabik wrote a letter saying he was willing to settle for $50,000 and indicating an alternative could be litigation and that his overall losses were seven times the amount he sought.

Hrabik wrote: "I would be willing to accept this $50,000 along with the $600 from fines I prepaid (that were overturned in superior court but not refunded) and move on. I reserve the right to change my mind on this matter at any time until an offer is made by the city."

Hrabik took $50,000 of our tax dollars to drop his claim.

The city, at the direction of the City Council, reimbursed Hrabik's $50,000 conditional use permit fees to bring the situation to a close and end the threat of a potential lawsuit. The City Council candidates differ on whether the agreement was a settlement or a refund. Either way, the city had to pay $50,000 for costs incurred during the permit process for sound engineers, attorney fees and other items that would normally be covered by the business seeking the CUP.

Judge ruled that Hrabik made an illegal and false statement.

Hrabik submitted a ballot statement that was legally challenged by RSM resident April Josephson—an avid supporter of Beall and Gamble—who wanted a laundry list of things stricken from it. The judge ruled, based on a 2006 letter Hrabik wrote to the city explaining he was moving his business from Lake Forest to RSM to be closer to home, and based on the national economic peak having occurred after his move, that Hrabik could not say he moved his business to RSM after the recession started. So, a sentence that said, "When the recession started and I saw so many of Rancho families out of work," was changed to delete the phrase "the recession started and."

Although the official ballot statement now reads, "When I saw so many of Rancho families out of work, I moved my business to RSM," the original wording still (as of Nov. 4) exists on Hrabik's campaign website under "Ballot Statement."

Hrabik Says: A national survey ranks the RSM business climate behind New Orleans, Philadelphia and even El Centro...

Hrabik and Planning Commissioner Peter Whittingham cited the Milken Institute Study for Best Performing Cities as the basis for their claim the city was not business friendly, and this was part of the foundation for the city's needing a "Voters Bill of Rights." They used figures for greater Orange County—collectively Santa Ana, Anaheim and Irvine—and claimed it represented Rancho Santa Margarita. RSM was never part of that national survey.

Hrabik Says: The City of RSM has a more generous public pension system than San Francisco.

Retired City Manager Hayman, who was a pension administrator in Costa Mesa before coming to Rancho Santa Margarita, said, "I did enough research into San Francisco to absolutely know that was an untrue statement." It should also be noted that RSM was one of the very first cities to adopt some level of pension reform. Additionally, RSM spends less on pensions per capita than any city in Orange County and is dealing with fewer than two dozen employees. 

Hrabik Says: City Council members have "exploited loopholes" to pay themselves full-time pensions.

Hayman, who retired as RSM's top administrator in July, said the City Council has never participated in a pension program. City Council members participate in a "defined contribution plan" which, according to Hayman, "is what pundits across the state are clamoring to get everyone to do." He said council members receive a percentage equal to the contribution that would be going to Social Security. Essentially, those funds can be placed into a 401K-type of program that will be available after the age of 59. It could grow in value or, if poorly invested, be worth nothing. Council members can do this in lieu of receiving health benefits. Hrabik said he wants to remove the health benefits option for elected officials.

Sharon Y. November 05, 2012 at 06:47 PM
Well oldrimer I have to wonder about the Baric connection as well. It was Kenny who supported him with his signs all over his van 2 years ago. Then Baric votes to give Kenny a pay off for 50k. Kenny then spends it on a campaign that advertises on his trucks he is voting lockstep with Baric, something smells in paridise, Kenny is the worst thing that has happened to RSM
Dove Canyon Oldtimer November 05, 2012 at 07:12 PM
Thanks for the clarification Martin. But didn't Baric have Kenney on his list of top 3 candidates to appoint to the council? And Baric still should have some explaining to do about his planning commissioner.
April Josephson November 05, 2012 at 07:33 PM
On one of Oldtimer's points: "Throw in all of the personal threats he has made to individuals who don't support him, to those who have had significant negative personal interactions with him but are afraid to go public in fear of retribution" I originally had an open mind regarding Kenney, until I witnessed way too many unjustified personal attacks by him in public—and not just towards council members. I watched him selfishly destroy the peaceful enjoyment of our community, and know many people who's lives have been unapologetically forever altered. It was seeing so many of those who were too afraid to speak up for fear of retribution that led me to speak up myself. Once I did, I too have become one of the targets of his self-righteousness, lie-filled, unwarranted personal attacks. I am glad that Martin investigated this mail piece. Since I won the court case against Kenney for removal of the false, misleading statement, I have monitored both his campaign statement on Patch and his website, hoping for removal of the false, misleading statement. But, true to form, nothing has changed. Kenney is only concerned about himself and the supposed attack against his character. IMO, the mere fact that he has done nothing to remove the falsehood that the court ordered him to remove (and he agreed to through his attorney) says everything anyone needs to know about his character.
April Josephson November 05, 2012 at 07:51 PM
LeAna, speaking from my years of personal experience with Kenney, and watching his many public verbal threats and unrelenting personal vendetta, I don't see why the city should have waited for a formal written claim to be filed. They were attempting to find a way to resolve the situation that would never go away until they did what he demanded. Kenney's statement at the end of his letter: "I reserve the right to change my mind on this matter at any time until an offer is made by the city," is an implied threat that was put in writing. You have not been there to witness the constant verbal harassment of those associated with the city. I have seen it first-hand many times. It was clear to all who have been involved in dealings with him that he would continue unless and until they did what he said. After watching the situation unfold over the years, I am certain that it was meant as a threat to the city, which in my mind amounts to extortion.
April Josephson November 05, 2012 at 07:56 PM
Nancy, I believe that the Sheriff's Department has information on a neighborhood crime specialist who is in charge of assisting with setting up Neighborhood watch programs. I have seen such signs in some areas of the city already. Have you tried contacting them?
April Josephson November 05, 2012 at 08:01 PM
Donnamarie, I agree that character counts. That is why I could never vote for Kenney. How is campaigning by putting other candidate's names and the words "personal greed" on your vehicles that are parked around town showing your merit as a candidate? It certainly shows poor character IMO.
Craig November 05, 2012 at 08:09 PM
I thought the city restricted where candidates can put signs. This year there are signs everywhere, especially the incumbents. Signs are in parking lots, entrances to neighborhoods, you name it. You would think the Mayor would follow his own rules. The other candidates are doing it too. This needs to be fixed. It's too late for this election, but something needs to be done for future elections.
TrueBlueAmerican November 05, 2012 at 08:16 PM
You are right Donnamarie! I will not vote for McGirr (a lawyer), Beall (a lawyer), Gamble (a politician) or Acosta (a politician)! They are all politicians who, as with all politicians, manipulate the truth! I will vote for McCook and Kenney who have real business experience!
TrueBlueAmerican November 05, 2012 at 08:34 PM
I agree with you Donnamarie1 McGirr is a lawyer, Beall is a lawyer, Gamble is a long time politician, and Acosta is an elected politician! Our household votes are for McCook and Kenney Hrabik! Tom Hutson
Glenn Acosta November 05, 2012 at 08:47 PM
Nancy, It's Form 460, which is available at the city clerk's office in City Hall. It's a public document that lists the donors, contribution amounts, and expenditures. Hope this helps. Best regards, Glenn
Martin Henderson (Editor) November 05, 2012 at 09:33 PM
Hi LeAna, I clearly stated there was no formal filing of litigation. However, it was incumbent upon me to share with residents who may not understand the way City Hall works that they don't enter into settlement agreements unless threatened with litigation either written or verbal. You can draw your own conclusions but you should know how the process works and why it works that way. FWIW, I hate being a fact-checker.
Martin Henderson (Editor) November 05, 2012 at 09:35 PM
My apologies to all -- the "all comments need approval" setting was checked accidentally. It should be OK now and you'll see your comments in real time.
Marilyn P. November 05, 2012 at 09:38 PM
I see, Tom Hutson, self-proclaimed TrueBlueAmerican: You are purposely NOT voting for the four most qualified candidates, in favor of Kenney Hrabik who will tell lies about our city, or in favor of Larry McCook who clearly has no idea what he's doing. Please do us all a favor before you vote: watch the videos of the candidates' forums and/or read some of the written transcripts of the candidates' answers. Then please tell me if you think Larry McCook and Kenney Hrabik and the two best choices for our City Council.
April Josephson November 05, 2012 at 09:52 PM
Excellent point, Marilyn. BTW, the distinctions "True" is trying to make are not valid in my book. McCook is a politician who has campaigned longer than anyone. Kenney is a politician—he has campaigned longer and spent far more than any candidate in this election. I fully expect him to spend the $50,000 he took from the city in his settlement on his campaign, instead of on his business. Not smart business in my book. Plus, McGirr, Beall, and Gamble are all business people as well.
LeAna Bui November 05, 2012 at 10:25 PM
April - It seems my experience is the opposite of yours. Having been on the receiving end of the Tony Beall machine and having no first-hand knowledge of the claims made by and against Mr. Hrabik, my instinctive sympathies lie with Mr. Hrabik. And as I stated, it bothers me greatly to see so much negativity and ugliness in a local city council race. This is not the first time and the only common denominator is Mr. Beall so.........make of that what you will.
Sharon Y. November 05, 2012 at 11:32 PM
I take a huge issue with you comment LeAna….the first ugly race in RSM that I am aware of was 2 years ago when Jesse did several hits and lies about Mr. Thompson. I also remember the “Thompson corrupt “ signs placed all over, they were huge! Jesse ,Steve and Kenny are the team that has brought so much negativity to the local races, funny you don’t seem bothered about it, I find you don’t apply the same standard to those who agree with you to those who don’t.
Pautna November 05, 2012 at 11:33 PM
Seeing the picture of Hrabik and Romney together was all I needed to know that I would NOT be voting for Kenny. :-)
TrueBlueAmerican November 06, 2012 at 12:38 AM
Marilyn P, You might be surprised that Mr. McCook knows exactly what he is doing and exactly what is going on with and at the City Council meetings. Your vsion is so jaded in your support of the two lawyers and Gamble that you have become irrational. Your blind support for Beall. Gamble and now McGirr shows that you do not see value in anyone else. Fortunately, there are thousands of voters going to their respective polling locations tomorrow that do not agree with you and see you for what you really are! A mouthpiece for Beall and Company.
LeAna Bui November 06, 2012 at 02:51 AM
Sharon Y. - you can take issue all you want. I'm not excusing anyone. Merely stating a fact that Mr. Beall has been the common denominator in the so-called "ugly" council races that have taken place in RSM since BEFORE 2010. That is concerning.
LeAna Bui November 06, 2012 at 03:26 AM
Maybe if everyone stopped the hit pieces and lawsuits and threats of law suits, we wouldn't need the fact checks and explanations.......
RSM Dad November 06, 2012 at 04:05 AM
Thanks for investigating this Martin and bringing to light the unethical and vicious nature of Hrabik. He is a deceitful person and I can't imagine why anyone would do business with him and Dove Canyon Courtyard
inRSMSince1990 November 06, 2012 at 05:21 AM
Looking at the big picture, we live in a wonderful community that has successfully navigated extremely challenging economic circumstances. Rancho continues to be safe, clean, well-maintained, a model of conservative fiscal management and a highly desirable place to live and raise a family. What are the issues that are bothering you? How do those issues affect the quality of life for those that live in Rancho? What could possibly motivate you to vote for someone without a college degree (McCook) who wants to turn the hills above Rancho into a business complex and a haven for manufacturing facilities… or alternatively, for someone who has significant personal financial incentive (Kenney) to make changes to city rules that benefit his own business, at the expense of community members whose interests the City Council is supposed to protect. What am I missing here?… Enlighten me… please…
Lindsey November 06, 2012 at 06:52 AM
After seeing this article I will defriend The Patch from my Facebook Likes and never read this online news source again. I do believe you are campaigning for one side here and like one of the comments says "The common denominator is Mr. Beall."
Lawrence (Larry) McCook November 06, 2012 at 03:31 PM
Mr. Alias (inRSMsince 1990), Thanks for the kind words on behalf of you/your incumbents! Actually, I will match/compare my worldwide business success with anyone else who lives in Rancho Santa Margarita holding degrees. Un beknowst to you, I do have and earned 4 diplomas in Silicon Wafer Processes.. My University of Alabama thought enough about me to honor me with an appointment as a National Vice President of The National Alumni Association. In the course of many years in business, the best engineers that I ever hired were non deg-reed. The truth is, Chiquita Ridge may never happen because of enviromental, esthetic and budgetary restraints. It is my sincere belief that the taxpayers of RSM do not want new taxes, bonds or Mello Roos to finance Chiquita Ridge. Have a wonderful day with your incumbents and good luck. Larry McCook in RSM since 1998. www.larry4rsm.com
Martin Henderson (Editor) November 06, 2012 at 05:11 PM
Sorry to hear that Lindsey, that one article would make you feel that way, when it was used as an opportunity to square away the truth. Is it a bad thing that a man tells us something and we check to see if it's accurate? If that moves you away from all the other things that Patch provides, then I'm sorry you feel that way. FWIW, I know a lot more than what is in this article.
April Josephson November 06, 2012 at 07:42 PM
LeAna, we do disagree on this. I have participated in every city council election since cityhood. The first time I saw the negative campaigning with signs, mailers and a political action committee formed to oppose a candidate was two years ago. Mayor Beall did not participate in that election. There is no common denominator other than the Kenney/Jesse group.
Pam Ragland November 07, 2012 at 07:51 AM
1) The 1st "dirty" election was 2006 when Tom Cutkomp ran against me & incumbents. He ran for the wrong reason, & it showed. Ms. Bui supported him therefore attacked me. 2) My 1st time running, I saw "adults" in the Cutkomp camp behaving badly... stealing election signs, splattering thousands of signs over the city, covering other people's signs, & sending lies about me in email. Why? To win at all costs. Beall was NOT running then. 3) What was the incumbent's crime? Protecting RSM in what they perceived was not good for the city, & corruption from CUSD. Whether you agree or not, it was for the right reason... not just to be self serving. This is as it should be, & the only reason I volunteered my time in RSM to stay appointed for 8 years on Economic Development. The orginal incumbents left the city with a surplus, & in a good position despite the worst economic climate of my lifetime. They continually work to reduce red tape, taxes, & to do the right thing for RSM not just themselves. This rare breed of politician is what you want. What needs to happen is more of this. So I say stop all the attacks & do the right thing for the right reason, now & future. It's only then RSM will continue to benefit.
Laddie McCabe November 08, 2012 at 12:04 AM
Sadly you don't know Kenney like I do - I've known him for over 30-years and know for a fact that the lies about him and his character are over-exagerated. He has been very forthcoming about the issues concerning the cities attempts at damaging his business. He was not paid $50,000 to stop a suit - he was able to recoup $50,000 of his losses imposed by the city of which he had already paid. I really think you should understand the entire story before offering a rediculous uninformed opinion.
April Josephson November 09, 2012 at 03:57 PM
Laddie, I find it sad that you base your opinion on Kenney's word alone without investigating it yourself. You have been misinformed by someone with an unfounded personal vendetta. I was part of the city's economic development committee, and witnessed everything as it happened. The city NEVER attempted to damage Kenney's business. Kenney must not have done his research prior to locating his business in a place where it did not belong—it was not zoned for his type of use—nor should it have been. The city should be given credit for finding a way to allow Kenney to operate his business, even though it shouldn't be there at all. Kenney damaged Kenney's business. In his settlement with the city, which I have read, Kenney admits to wrongdoing. The city did not—because they did nothing wrong. It's unfortunate that your longtime friend is so blinded by his misguided attempts to blame others for his problems that he can no longer see straight. As I stated in my other posts, Kenney was so hellbent on seeking revenge for his perceived wrong, that the city settled with him to stop his threats and false accusations. The settlement is done. If Kenney really felt that his settlement was a refund of his business expenses, he would have taken the $50,000 and used it to build his business rather than spend it on a nasty, failed campaign against our city. Kenney has wronged our city officials and the voters agreed. It's time to accept it and move on.
Lawrence (Larry) McCook November 09, 2012 at 04:12 PM
I totally agree with you Pam. Thank you for your past and present positive interest in Rancho Santa Margarita. All of the yard sign shenanigans that you listed also happened to my signs. What immature low witted actions which I actually found very funny!

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